The latest from DTC Perspectives

Industry Reputation Declines Again

For those employed by the pharmaceutical industry that feel they must defend their company/industry to their friends, neighbors and relatives, the news is bad. A recent survey just released by Harris Interactive shows the pharmaceutical industry has lost ground in 2007 versus the prior year. Positive ratings declined another 2 points in 2007 to a low of 26% of American consumers who give drug companies a positive rating.

Who else is ranked with drug companies at the bottom? No one rivals tobacco at only a 10% positive. Airlines tie pharma at 26%, with energy slightly above at 28%. If one looks at the survey from the perspective of negative ratings pharma actually is second to last with 52% having a negative opinion of drug companies.

So what should pharma public relations people take away from this survey? It has to be that all that price support advertising with Montel Williams and other corporate ads extolling the virtues of their R&D is not resonating well enough with Mr. Average American. I have said this before but will say it again. The only way for drug industry corporate ads to work is for the programs advertised to actually be used by a majority of consumers who qualify.

The fact is that despite the existence of price support programs for many years, too few eligible are enrolled or are aware of them. Most of the ads for the price support program with Montel are placed on news shows, not on prime time or other shows most watched by low income Americans. Second, the real measure of success is how many are enrolled versus those eligible. Until a majority who qualify use the program, high price will be the major issue leading to a poor industry reputation. Therefore drug companies need to evaluate themselves based on the percent of those who need help that are getting help. The mere existence of help and advertising that fact to opinion leaders does not really show a genuine push for success.

Another issue is the perception of sales over safety. Whether the courts or Congress will find real evidence that drug companies did wrong through late disclosure of safety issues is still to be determined. I am sure, however, most consumers believe that drug companies place profits before safety. This belief is partly driven by many recently published mass market books and news stories covering the drug companies. Of course the numerous recent price fixing cases, off label marketing accusations and drug withdrawals provide support for the sales over ethics perception.

The value of good reputation is hard to quantify. Clearly it must help in attracting good employees. I would assume it helps in getting the best research partnerships. It must also help when safety problems emerge with a product. With drug industry reputation so low, credibility is doubted when trying to defend a problem drug. The drug industry must decide what improving their reputation is worth. They could accept the second lowest ranking or decide how to make it better. Clearly their current approach has fallen short and anyone charged with making it better has largely failed, unless the goal was a controlled decline. I know all the good things the drug companies do, and why prices are higher, but you need not convince me. It is the 74% of Americans who do not like you that need the convincing. Will it happen? Maybe it will if a bunch of new wonder drugs get discovered or if prices are drastically reduced. Otherwise, do not look for the second to last reputation spot t o be vacated soon. It is a challenge that must be dealt with by the CEO's or they risk significant legislative and public backlash.